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26 March, 18:59

The standard costs and actual costs for factory overhead for the manufacture of 3,000 units of actual production are as follows: Standard Costs Fixed overhead (based on 10,000 hours) 3 hours per unit @ $0.70 per hour Variable overhead 3 hours per unit @ $1.97 per hour Actual Costs Total variable cost, $18,200 Total fixed cost, $8,100 The amount of the fixed factory overhead volume variance is

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  1. 26 March, 21:34
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    overhead volume variance = $ 1970

    Explanation:

    GIVE dа ta:

    fixed overhead = $8,100

    variable overhead = $18,200

    standard hours for production = 3000*3 = 9000

    standard cost per hour = 1.97+070

    The total factory overhead volume variance = Total actual OH (fixed + Variable) - Standard OH (variable + Fixed)

    = ($ 18,200 + $ 8,100) - (Standard hours for actual production x Standard Cost per hour)

    = $ 26,000 - [ (3000 x 3) hours x ($ 1.97 + $ 0.70) per hour]

    = $ 26,000 - (9000 x 1.67)

    = $ 26,000 - $ 24,030

    = $ 1970

    = $ 1970
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